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Nation closing in on $31.4T borrowing limit 

The federal government is closing in on the $31.4 trillion borrowing limit, meaning a high-stakes fight over raising the debt ceiling is fast approaching. 

An estimate from the Peter G. Peterson Foundation places the nation’s debt at $31.39 trillion and counting on Wednesday, just a hair below the limit set more than a year ago. 

That doesn’t mean the debt ceiling will have to be lifted this week — or even this month. The Treasury Department can generally use what are known as extraordinary measures to put off an actual debt crisis.

But it’s clear the fight is edging closer, putting the White House on a collision course with a new House majority demanding deep discretionary spending cuts in exchange for any increase to the debt ceiling.

“I think this is going to be the defining moment of the year,” Maya MacGuineas, president of the Committee for a Responsible Federal Budget (CRFB) said, adding it’s “certainly possible that we’ll hit that limit this month, or next month.”

The “extraordinary measures” used by Treasury generate cash to help the government pay its debts, which include halting pension fund contributions and prematurely redeeming Treasury bonds, could run out sometime in July, according to an estimate from the CRFB. 

That means Congress will need to act by mid-summer at the latest to prevent the government from defaulting on its debt.

Just getting close to the so-called “X-date” poses risks. After the 2011 debt ceiling fight between Republicans and President Obama, S&P downgraded the nation’s long-term credit rating. 

Speaker Kevin McCarthy (R-Calif.) promised that any debt ceiling increase would be paired with spending cuts to win over his GOP opponents in last week’s Speakership fight. But Democrats will likely refuse to go along with those cuts, setting up a stalemate. 

“If you’re going to ask for an increase in the limit, at some point in time, you’ve got to sit down and say why are we hitting the limit? Why are we maxing out the credit card?” House Majority Leader Steve Scalise (R-La.) told reporters Tuesday. 

Experts say that a default on the federal debt could upend the financial system and send the U.S. economy into a recession, in addition to pausing government benefits such as Social Security and Medicare. 

A 2021 report from Moody’s Analytics found that a default would cost the U.S. roughly 6 million jobs and $15 trillion in household wealth. Damage to the U.S. credit rating would likely cause interest rates for homes and cars to spike. 

There’s also concern about how it would impact the country’s standing on the global stage.

“We borrow a lot of money in world markets, and the U.S. Treasury bond is the single most valuable risk-free security there is,” said David Wessel, director of the Hutchins Center on Fiscal & Monetary Policy at the Brookings Institution.

“So, why would we want to put in doubt the possibility that we might not be able to pay our obligations?”

A recent report from The Associated Press indicated the government could hit the debt ceiling as soon as this week. The Treasury Department declined to comment on the report to The Hill on Wednesday, but members also stress that point is not so far in the future.

Rep. Brendan Boyle (Pa.), top Democrat on the House Budget Committee, told The Hill on Wednesday that the public treasury debt statements reflect that the country is “rapidly approaching the statutory debt limit, which will require the use of extraordinary measures.”

Experts are expecting more clarity after tax season heats up in April and the government collects a heap of revenue, which can have a significant impact on when the nation hits the debt ceiling.

“That’s where we find out whether it will come in at above or below expectations, and will give us another sense for how long those extraordinary measures combined with incoming revenues will be able to fund the government,” MacGuineas said. 

Among the concessions some House Republicans have floated in recent months are potential reforms to Social Security, which is on track to insolvency. But some Republicans have also sought to dial down the focus on such proposals since the party took control of the House last week. 

“What we have been very clear about is, we’re not going to touch the benefits that are going to people relying on the benefits under Social Security and Medicare,” Rep. Chip Roy (R-Texas) said during a recent appearance on CNN. 

“But we all have to be honest about sitting at the table and figuring out how we’re going to make those work, how we’re going to deal with defense spending and how we’re going to deal with nondefense discretionary spending,” he said.

Roy is among the more than a dozen GOP members who voted against McCarthy’s Speakership bid last week until the leader agreed to several key concessions, including new limits on discretionary spending. 

That attitude has encouraged some budget hawks, though some experts downplay the chances of a significant deal as part of any compromise in a divided Congress.

“Congress should decide what do they want to spend more money on, and how do they want to change taxes, and they ought to do that in a way that looks over the next several years decades,” Wessel said, adding “using the debt ceiling to do that is like playing Russian roulette and putting a gun to your head.”

Source: TEST FEED1

McCarthy doesn't call for Santos to resign: 'The voters elected him to serve'

House Speaker Kevin McCarthy (R-Calif.) on Wednesday declined to call for Rep. George Santos (R-N.Y.) to resign over fabrications about his resume and questions about his finances even as New York Republicans raised the pressure on the embattled freshman lawmaker.

“I try to stick by the Constitution. The voters elected him to serve. If there is a concern, and he has to go through the Ethics, let him move through that,” McCarthy told reporters on Wednesday.

“He will continue to serve,” McCarthy said of Santos.

McCarthy’s comments mark his most substantive statements to date about Santos, weeks after the congressman admitted to misrepresenting his background.

Asked about Santos admitting to fabricating parts of his resume, McCarthy said: “So did a lot of people here, in the Senate and others.”

That deflection echoed Santos pointing to President Biden and other Democrats when asked about the fabrications. 

But Santos’s fabrications about going to college, working at major financial institutions, having employees lost in the Pulse nightclub shooting, and misleading claims of Jewish heritage – as well as major questions about his sharp increase in reported personal wealth that he used to finance his campaign – put him in a class of his own.

“It’s the voters who made that decision. He has to answer to the voters and the voters to make another decision in two years,” McCarthy said.

“He is going to have to build the trust here and he’s going to have the opportunity to try to do that,” McCarthy said.

Local New York Republicans – as well as fellow freshman New York Rep. Anthony D’Esposito – called on Santos to resign earlier on Wednesday.

It has been typical in the past for members of Congress to only step down after they have been convicted of a crime. While both local and federal authorities in the U.S. are reportedly investigating Santos, no charges have been filed against him.

“What are the charges against him?” McCarthy said. “In America today, you’re innocent ‘till proven guilty. So, just because somebody doesn’t like the press you have, it’s not me that can over-say what the voters say the voters say.”

Brazilian authorities, however, are reportedly reviving a case against Santos relating to a checkbook he allegedly stole in 2008. Santos has denied being charged with check fraud in Brazil.

“If there is something that rises to the occasion that he did something wrong, then we’ll deal with that at that time,” McCarthy said.

McCarthy said earlier on Wednesday that Santos would not be assigned to the Appropriations, Ways and Means, Financial Services, and Energy and Commerce committees, but he has not ruled out Santos sitting on other committees.

It would take a two-thirds vote of the House to expel Santos from his seat.

Mychael Schnell contributed.

Source: TEST FEED1

5 things to know about the system outage at the FAA

Departures of domestic flights are resuming across the country after the Federal Aviation Administration (FAA) restored a system that warns pilots of hazards during their upcoming flights.

The FAA first issued an advisory just past 4 a.m. on Wednesday that a technical issue impacted its Notice to Air Missions system (NOTAM), and it announced a couple hours later that it had ordered all airlines to pause domestic departures until 9 a.m. to ensure flight safety.

Thousands of flights were delayed and hundreds have been canceled, but airlines are gradually restoring normal operations.

Here’s five things to know about the system outage at the FAA:

The FAA is assessing the cause of the initial problem

The FAA said that it continues to look into the cause of the initial problem. President Biden on Wednesday reiterated that “they don’t know what the cause is.”

At 6:30 a.m. on Wednesday morning, the FAA said it was reloading the NOTAM system, which warns pilots of potential hazards such as closed runways and birds. The outage affected operations across the National Airspace System. 

The FAA grounded all planes while it was working to restore the system and repopulate it. Over a few hours on Wednesday, airlines were ordered to pause all domestic departures so the agency could “validate the integrity of flight and safety information.”

The administration has not seen evidence of a cyberattack

The White House said while flights were still grounded that it had not seen evidence of a cyberattack being the cause of the system outage. Biden spoke to Transportation Secretary Pete Buttigieg, telling him to report directly back when they learned the cause.

Biden said just before 8 a.m. that the FAA will have a “good sense” of what caused the issue within a couple hours.

“There is no direct indication of any kind of external or nefarious activity, but we are not yet prepared to rule that out,” Buttigieg told MSNBC on Wednesday.

White House press secretary Karine Jean-Pierre also tweeted that “there is no evidence of a cyberattack at this point, but the President directed DOT to conduct a full investigation into the causes.”

Buttigieg said he directed the FAA to conduct an “after-action process” to determine the causes of the glitch and make recommendations for next steps to be taken. 

Flights are back up and running

The ground stop was lifted just before 9 a.m. on Wednesday and all domestic flights gradually resumed operating. 

Departures resumed at two particularly busy airports, Newark Liberty and Atlanta Hartsfield-Jackson, about 30 minutes earlier to clear up air traffic congestion in those areas.

But the ground stop seems to have had an impact on domestic flights for at least the rest of the morning, if not longer. Over 7,000 flights within, into or out of the United States were delayed Wednesday, and more than 1,000 were canceled, according to the flight-tracking website FlightAware.

Reuters reported that more than 21,000 flights were scheduled to depart U.S. airports on Wednesday.

Travelers are likely to face delays throughout the day or longer

With hundreds of flights across the U.S. delayed as a result of the system outage, it will likely take a day or more for flight operations to resume as usual.

The flight disruptions on Wednesday follows massive Southwest Airlines cancellations two weeks prior, when the airline canceled more than half of its flights over a three-day period after Christmas and thousands of passengers were left stranded.

The issue occurred after the airline’s scheduling system struggled to route pilots and flight attendants to the right planes following strong winter storms that hit Denver and Chicago. Southwest CEO Bob Jordan said its scheduling system needs to be modernized.

The outage prevented flights from taking off, not landing

There was no real danger to flying during the system outage because flights were grounded. 

Planes that were already in the air were safe to land, but those still on the ground could not take off safely.

The FAA tweeted that pilots review the NOTAM system before they take off, so they would be aware of any possible hazards in advance of departure.

Multiple airports internationally also said that they were able to continue flights into the U.S. without any interruption. NBC reported that spokespeople for Air France, Frankfurt Airport in Germany and Gatwick Airport in London said they were still operating to and from the U.S.

Source: TEST FEED1

First sitting House Republican calls on Santos to step down 

The first sitting House Republican has called for Rep. George Santos (R-N.Y.) to step down from his lower chamber seat after he fabricated much of his professional and educational background on the campaign trail to get elected. 

“George Santos does not have the ability to serve here in the House of Representatives and should resign,” Rep. Anthony D’Esposito, one of Santos’ fellow GOP congressmen from New York, said at a press conference with the Nassau County Republican Committee. 

Just weeks after being elected to the Long Island House seat, Santos admitted to making several false claims on his resume, including misrepresenting his work with top Wall Street firms and falsely saying he’d gotten a degree from a New York college when he’d not graduated from “any institution of higher learning.” 

Democrats quickly called for Santos to resign from his elected position, or for the House GOP to take action against him. Some Republicans have called for an investigation into the matter, but D’Esposito is the first sitting lawmaker in the new Congress to call for Santos to resign. 

“It has become clear that Congressman George Santos’ many hurtful lies and mistruths surrounding his history have irreparably broken the trust of the residents he is sworn to serve. For his betrayal of the public’s trust, I call on [him] to resign,” D’Esposito said in a Wednesday statement shared with Politico. 

“When public servants deceive and mislead those they are tasked with serving, they are no longer fit to work for the people,” D’Esposito said. 

Santos, though, insisted Wednesday that he won’t resign amid the pressure from Republicans in Nassau County and elsewhere, just days after being sworn in to the 118th Congress.

Source: TEST FEED1

New GOP Oversight chair launches probes into Biden finances, Hunter Biden laptop story

New House Oversight and Accountability Committee Chair James Comer (R-Ky.) on Wednesday launched the GOP’s long-awaited investigation into President Biden and his family’s finances, requesting information from the Treasury Department.

Comer sent a letter to Treasury Secretary Janet Yellen asking for documents and information on Biden’s family businesses, including any Suspicious Activity Reports (SARs) generated by banks in relation to the Biden family. Comer said in the letter that his committee is investigating Biden’s involvement in his family’s “foreign business practices and international influence peddling schemes.”

Republicans have been preparing to investigate Biden and his family since they won the House majority in the 2022 midterms, saying that his involvement in his family’s businesses, and particularly those related to his son Hunter Biden, could pose a risk to national security.

“The Committee is investigating President Biden’s knowledge of and role in these schemes to assess whether he has compromised our national security at the expense of the American people,” Comer stated in the letter. “Additionally, we will examine drafting legislation to strengthen federal ethics laws regarding employees and their families.”

“We will also examine and make recommendations regarding federal laws and regulations to ensure that financial institutions have the proper internal controls and compliance programs to alert federal agencies of potential money laundering activity,” he added.

Comer said in the letter that Treasury declined the GOP’s requests during the previous Congress, when Democrats held the majority in the House, and that they later informed him that they would only provide information about SARs if requested by a committee chair.

He said that the requested information should be delivered to the committee no later than Jan. 25.

He also sent a series of letters to former top Twitter executives calling for their testimonies about the company’s handling of news reporting from The New York Post that contained leaked data reportedly obtained from a laptop belonging to Hunter Biden. He said the executives were responsible for “censoring” news reporting about Biden ahead of the 2020 election.

“Your attendance is necessary because of your role in suppressing Americans’ access to information about the Biden family on Twitter shortly before the 2020 election,” the letters addressed to three different Twitter executives stated, adding that hearings on the issue will be held the week of Feb. 6.

Twitter temporarily prevented the New York Post and other Twitter accounts from sharing links to a story that included allegations regarding Biden and Ukraine with information that reportedly was taken from Hunter Biden’s laptop. At the time, Twitter said it violated its hacked materials policy.

“This investigation is a top priority for House Republicans during the 118th Congress,” Comer said in a statement. “The investigation will inform legislative solutions to protect Americans’ First Amendment right to freedom of speech and press and prevent public officials and their family members from using public office to enrich themselves.”

Source: TEST FEED1

Local NY Republicans call on Santos to resign

Nassau County Republicans on Wednesday urged Rep. George Santos (R-N.Y.) to resign from office over his fabrication of his resume during his successful campaign to win election to the House.

“George Santos’s campaign last year was a campaign of deceit, lies and fabrication,” Nassau County GOP chairman Joseph Cairo said in a press conference Wednesday. “Today I am calling for his immediate resignation.”

Santos is the subject of controversy after The New York Times published reporting detailing discrepancies about the congressman’s personal and professional life, including where Santos claimed to have worked and graduated from college. The Long Island Republican later admitted that he was guilty of “embellishing my resume,” angering Republicans and Democrats alike.

“Congressman-Elect George Santos has broken the public trust by making serious misstatements regarding his background, experience and education, among other issues,” Nassau County GOP Chairman Joseph Cairo said in a statement in late December. 

“He has a lot of work to do to regain the trust of voters and everyone who he represents in Congress,” the top Republican in Nassau County said.

Source: TEST FEED1

Democrats want Biden to run against House GOP

Democrats think President Biden can get a boost from the House GOP, just as his party’s past presidents saw their political fortunes rise by virtue of battling a Republican Congress.  

Both former Presidents Clinton and Obama won reelection after losing their party’s House majorities to the GOP in 1994 and 2010. 

Now the White House is hoping Biden can follow that pattern, and they see an unwilling partner in the House GOP led by Speaker Kevin McCarthy (R-Calif.), who won the post after a historic 15th ballot that laid his conference’s divisions out for all to see. 

“If they’re collapsing and fighting and can’t get anything done, it speaks for itself,” said Ed Rendell, a former Pennsylvania governor and longtime Biden ally.  

Rendell also argued that some of the positions taken by House Republicans, especially if they lead to a government shutdown or the failure of Congress to raise the debt ceiling, could help Biden cast himself as the adult in Washington.  

“Americans are not extreme,” Rendell said.  

Other Democrats see the chaos of the Speaker election as contrasting well with what Biden wants to cast as his strengths: preparation, moderation, respect for tradition and a reverence for procedures.  

“It really is a perfect foil for Biden,” said Democratic strategist Eddie Vale. It “just gets better and better the more tinfoil hat conspiracy theories Jordan, Comer and Marjorie Taylor Greene spin off on,” he added, referring to GOP Reps. Jim Jordan (Ohio), James Comer (Ky.) and Greene (Ga.). 

Nayyera Haq, a former Obama aide, said Biden won in 2020 by running against former President Trump, and now he can run against the emboldened House GOP. 

“Usually being the party out of the White House means that you have a unified message against an incumbent,” she said of House Republicans. “They don’t have that right now.” 

The Speakership election tied the House GOP further to Trump in some ways.  

Initially, a group of Republicans opposed to McCarthy’s Speakership ignored Trump’s calls to back him. But by the end of the week, some of those members had supported the former president himself for House Speaker. And in the final hour, Greene was trying to connect Trump to various Republicans to get them to vote “present” and allow McCarthy to be elected Speaker.  

Biden, meanwhile, appeared at a bridge connecting Kentucky to Ohio with Senate Minority Leader Mitch McConnell (R-Ky.), highlighting his infrastructure legislation and bipartisanship. 

“They looked f—— crazy last week,” one Biden ally said, pointing to the split screen of Biden and McConnell, who stood alongside one another. “I talked to so many Republicans who said ‘What the f— are we doing? This is terrible.’”  

The Speaker fiasco also provided a new opportunity for Democrats to reinvigorate Bidenworld’s famous “do less” approach to the GOP.  

As Republicans publicly fought within their own party, liberals and moderates alike watched the display unfold, reiterating that their side is ready to start working for the public — regardless of what the other side does. 

The question going forward is whether the dysfunction that was a part of the Speaker’s vote will be a recurring theme for Republicans in the lower chamber this year. Rendell and other Democrats appear to be hoping and thinking it will be repeated. 

“It’s too early [for] this incident, their pathetic display, to be remembered if they govern in a halfway reasonable manner,” said Rendell. “But people seem to think they won’t have the ability.”  

“If in fact, as predicted, it becomes a battle between the MAGA people and the conventional Republicans to get anything done and we default on stuff, that’s a big help. Then you can make the case they can’t govern,” he added. 

One House Democrat in touch with the administration said the “chaos” showed distinctions between the parties at a critical juncture. Democrats elected Minority Leader Hakeem Jeffries (D-Calif.) unanimously as GOP members repeatedly failed to elect McCarthy. 

“We are ready to get to work and stand in stark contrast to the chaos we’ve seen from the other side,” said Rep. Ro Khanna (D-Calif.).  

Democrats’ confidence is also backed up by polling. Biden’s approval rating rose significantly after November, with voters crediting him favorably for handling issues like the economy and reproductive rights. Typically hovering in the low to mid 40s last year, and even dipping into the 30s, he’s now earning 46 and 47 approval percent in several surveys collected by Real Clear Politics. 

He’s also ramped up his travel schedule to promote accomplishments like his infrastructure bill, and aides and allies are privately preparing for his 2024 campaign announcement, The Hill reported last week. 

Whether Biden should openly acknowledge the GOP’s discord is being debated. Some allies believe it’s not necessary that he explicitly says how dysfunctional things appear to be among his political opponents.  

“Depends on how bad it gets,” said Rendell. “If it’s really bad he doesn’t have to mention it.” 

That guidance is familiar territory for Biden, who went for long stretches of the last presidential campaign without calling out Trump by name. As president, he became more comfortable using the MAGA slogan to denounce what he sees as a threatening part of the Republican Party.  

Republicans are aware that Biden can use the House GOP as a target. 

“It’s incumbent on the new House Republican majority to plow the ground, to offer some ideas, to be a lead vehicle for the 2024 Republican nominating field and eventual nominee and not to become a political lead balloon or political drag,” said Republican strategist Colin Reed.  

“The Obama White House was very skillful at using the 2011-2012 Republican House Majority as a cudgel against Mitt Romney,” he said. “And no doubt the Biden White House will attempt to do the same thing.”  

Still, Biden is not without his own recent vulnerabilities.  

Republicans see fresh ammunition in the disclosure that classified documents had been discovered by attorneys for the president at a private office just days before the midterms at Penn Biden Center. The news only became public on Monday. 

While Democrats were eager to point out the differences in circumstances between the classified documents found at Biden’s former office at the university and classified documents from the Trump administration kept at the former president’s Mar-a-Lago residence, Republicans quickly went on the attack and accused the White House of hypocrisy.  

“Those in glass houses shouldn’t be throwing stones,” Reed said. “The Democrats, including President Biden, were so sanctimonious and holier than thou about rendering judgment on what happened in Mar-a-Lago involving those documents that are now going to have to answer the same questions.” 

Source: TEST FEED1

FAA pausing all domestic flight departures after computer outage

The Federal Aviation Administration (FAA) paused all domestic flight departures early Wednesday after a computer system outage sparked widespread delays. 

The FAA issued an advisory just after 4 a.m. ET saying that technicians were working to address the problem. United Airlines tweeted that the issue was with the FAA’s Notice to Air Missions (NOTAM) system, which sends out real-time flight hazards and restrictions to all commercial pilots, and that it was temporarily delaying all domestic flights. 

The FAA said at 6:30 a.m. that it was performing its final validation checks and reloading the system. 

The agency then said at 7:19 a.m. that it was still working to fully restore the system and ordered airlines to pause all domestic departures until 9 a.m. “to allow the agency to validate the integrity of flight and safety information.”

All commercial and military flights are required to use the system.

The agency said operations across the National Airspace System were impacted.

Information from NOTAM can be as long as 200 pages and mention runway closures, bird hazards and construction obstacles, according to Reuters.

The flight-tracking website FlightAware reported that more than 3,500 flights within, into or out of the United States were delayed as of just past 8 a.m.. More than 400 flights had been canceled.

More than 21,000 flights were booked to depart airports in the U.S. on Wednesday, Reuters reported.

Transportation Secretary Pete Buttigieg tweeted that he has been in touch with the FAA regarding the glitch. He said the agency is working to resolve the issue “swiftly and safely” to allow air traffic to resume normal operations.

Most of the delays on Wednesday have been for flights on the East Coast.

CNN noted that some airlines might be able to operate without information from NOTAM.

NBC reported that several airports outside the United States, including Gatwick Airport in London and Frankfurt Airport in Germany, have been able to continue their operations without interruption.

Stock prices for U.S. airlines also fell Wednesday during premarket trading, according to Reuters. Southwest Airlines fell 2.4 percent, while Delta, United and American airlines dropped about 1 percent.

–The Associated Press contributed to this developing report.

Source: TEST FEED1

The Hill's Morning Report — GOP goes on offense on Biden documents controversy

Republicans in charge of the House say they will investigate President Biden, his newly revealed possession of classified documents discovered at a Washington office building while also renewing vows to try to impeach a Cabinet secretary (The Hill).

The second week of the new year is awash in combative politics, headline-grabbing assertions and speculation, and repeated Washington references to former President Trump, which collectively energizes the new GOP majority, reports The Hill’s Emily Brooks. Welcome to 2023.

The Hill: GOP urges a “damage assessment” of classified documents found by Biden’s personal attorneys on Nov. 2 in an office he used after returning to private life after serving as vice president.

Republicans say they will demand to learn more about the classified documents Biden’s lawyers say they found in November less than a week before the midterm elections.

The Democratic chairman of the Senate intelligence committee, Mark Warner of Virginia, said he also wants a briefing about the documents that most Americans knew nothing about until Monday (NBC News).

And Biden on Tuesday told reporters that while he had been “briefed” about the discovery of materials in his old office space, first reported by CBS News on Monday, he does not know “what’s in the documents” and was “surprised” (The Hill). CNN and The Washington Post reported the Biden-retained records were designated “sensitive compartmented information,” or SCI, and included briefing materials on foreign countries.

“People know I take classified documents, classified information seriously. When my lawyers were clearing out my office at the University of Pennsylvania … they found some documents in a box in a locked cabinet, or at least a closet. And as soon as they did, they realized there were several classified documents in that box and they did what they should have done,” Biden said.

“I’ve turned over the boxes, they’ve turned over the boxes to the Archives. And we’re cooperating fully, cooperating fully with the review, which I hope will be finished soon. And there’ll be more detail at that time,” he added.

The Hill: The president gets a new political headache. 

The classified materials from the Obama administration were turned over to the National Archives, according to the White House, which says it is cooperating with a Justice Department review of what transpired — a review unknown to the public until Monday and described as separate from a Justice Department investigation of presidential records seized from Mar-a-Lago, Trump’s residence and his club.

“Our system of classification exists in order to protect our most important national security secrets, and we expect to be briefed on what happened both at Mar-a-Lago and at the Biden office as part of our constitutional oversight obligations,” Warner said in a statement.

House Majority Leader Steve Scalise (R-La.) on Tuesday complained that there is a double standard (ABC News).

“If then-Vice President Biden took classified documents with him and held them for years and criticized former President Trump during that same time that he had those classified documents, and only after it was uncovered, did he turn them back,” he told reporters, explaining why Trump and Republican lawmakers can now ask questions of the president.

The Hill’s Niall Stanage, The Memo: Biden documents deliver political gift for Trump. 

Senate developments: Minority Leader Mitch McConnell (R-Ky.) is in the eye of the 2023 political storm in the Senate, writes The Hill’s Alexander Bolton. Ahead are looming battles over raising the nation’s debt ceiling, keeping the government funded, clarifying the direction of the Republican Party and navigating politics amid Trump’s House GOP influence. 

Rep. Katie Porter (D-Calif.) said Tuesday she is ready to compete for the Senate seat held by 89-year-old Dianne Feinstein (D-Calif.), who has not announced whether she will seek reelection in 2024, reports The Hill’s Al Weaver. “I think there’s plenty of people who could look in the mirror and say, ‘Why not me?’” said Andrew Acosta, a Sacramento-based Democratic strategist. “Democratic Party politics in California is party politics on steroids.” 

The Hill’s Max Greenwood writes that Feinstein is expected to announce her retirement in coming months, opening a Senate seat for what would be a competitive race in a deep blue state. Porter previously made no secret of her ambitions.

The senator, in a barbed statement, reacted. “Everyone is of course welcome to throw their hat in the ring, and I will make an announcement concerning my plans for 2024 at the appropriate time,” she said. “Right now, I’m focused on ensuring California has all the resources it needs to cope with the devastating storms slamming the state and leaving more than a dozen dead” (Vox).

2024: Biden’s proposed rearrangement of the Democrats’ primary calendar next year may not happen because of GOP clout in Georgia and New Hampshire, which could mean the effort flops and the Democratic Party’s standard bearer appears weakened, Axios reported.

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▪ The Hill: Five members of the far-right Proud Boys group, including leader Henry “Enrique” Tarrio, are on trial today charged with seditious conspiracy and eight other crimes in the latest case involving alleged participants and planners of the Jan. 6 attack on the Capitol.

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LEADING THE DAY

➤ CONGRESS

The new House’s first big bipartisan win came Tuesday, when lawmakers voted overwhelmingly to create a select committee focused on U.S. competition with China, fulfilling a campaign promise Republicans made in the lead-up to the 2022 midterm elections. The resolution passed in a 365-65 vote, with 146 Democrats joining Republicans in supporting the measure.

The select committee, which will be chaired by Rep. Mike Gallagher (R-Wis.), plans to zero in on the Chinese Communist Party’s economic, technological and security progress and the strategic competition between Beijing and Washington. The group — which will be made up of seven Republicans and five Democrats — has the authority to hold public hearings (The Hill).

“I’ve heard my colleagues on both sides say that the threat posed by Communist China is serious. I fully agree,” McCarthy said during debate on the House floor Tuesday. “This is an issue that transcends political parties. And creating the select committee on China is our best avenue for addressing it.”

CNBC: GOP-led House creates a new committee to tackle threats from China, McCarthy’s first big bipartisan win.

When the Republican House majority passed new rules on Monday, it agreed to cap all new spending at 2022 levels, a rule that critics warn could cut defense spending by 10 percent, writes The Hill’s Brad Dress. The concerns come as Ukraine is expecting a long war with Russia and as Taiwan is under a growing threat from China. The fight over defense budget cuts, just days after the new Congress formed, could be foreshadowing clashes over spending throughout the next two years, as pro-defense lawmakers on both sides of the aisle have hammered Republican leadership for the potential spending cuts.

House Majority Whip Tom Emmer (R-Minn.) denied accusations the GOP will “defund” the military. 

“Republicans will not impact defense spending aside from efficiencies and waste,” Emmer said on Monday. “It’s the domestic spending we’re going to go after.”

As the cuts take effect, White House national security adviser Jake Sullivan expressed little concern for the foreseeable future in terms of funding for Ukraine, noting the $45 billion for Ukraine that was included in the $1.7 trillion omnibus funding bill last year.

“I do not see that money getting taken away from us,” he said at a press gaggle on Monday. “It is there. It is rock solid through nearly all or all of 2023.”

▪ Politico: Unpacking the House GOP’s new rules: A handy guide to the changes.

▪ The Hill: Top Democratic appropriator says the GOP is “guaranteeing a shutdown.”

House Republicans are also retooling and forming several new oversight panels in the new Congress. The existing House panel investigating the government’s response to the coronavirus pandemic will now be charged with examining the origins of the pandemic, including federal funding of gain-of-function research, better aligning with the majority party’s focus. The origins of the coronavirus have become intensely politicized, and Biden officials and outside scientists are bracing for a new wave of investigations.

The panel’s focus is a major change from how it operated under the Democratic-controlled House. Former Chairman James Clyburn (D-S.C.) prioritized looking into the early response and shortcomings from the Trump administration, as well as the former president’s political interference (The Hill).

▪ The Hill: Democrats planning to sit on all GOP select committees.

▪ Roll Call: Democrats ask ethics panel to probe Rep. George Santos’s (R-N.Y.) financial disclosures.

▪ The Hill: House Democrat planning legislation to allow C-SPAN cameras free range in chamber.

▪ Roll Call: Progressive Caucus starts year with bigger roster, focus on unity.

Also approved was a resolution to create a “weaponization” panel to investigate the federal government, giving the committee access to sensitive intelligence and the power to oversee ongoing criminal investigations. The panel’s creation is a victory for the House’s Freedom Caucus, which pushed for a body that would tackle several GOP gripes, carrying on panel chairman Rep. Jim Jordan’s (R-Ohio) prior claims that the Justice Department, and most particularly the FBI, has “ridiculed conservative Americans” (The Hill and Business Insider).

▪ The New York Times: Republicans pushed through a measure to create a powerful new committee to scrutinize what they have charged is an effort by the government to target and silence conservatives. 

▪ The Washington Post: Democrats describe the panel as an unprecedented breach of protocol.

Rep. Pat Fallon (R-Texas) on Monday introduced articles of impeachment against Department of Homeland Security Secretary Alejandro Mayorkas. McCarthy had previously threatened a potential “impeachment inquiry” into Mayorkas over the secretary’s handling of the U.S.-Mexico border if Mayorkas didn’t resign — making the move in a nod to the GOP conference’s right flank that ultimately undermined his speakership bid (Axios). Fallon has accused Mayorkas of “high crimes and misdemeanors” in his role as Homeland Security chief. The articles have since been referred to the House Judiciary Committee (NBC News).

➤ ADMINISTRATION

Biden, Prime Minister Justin Trudeau of Canada and President Andrés Manuel López Obrador of Mexico on Tuesday wrapped up a three-way North American Leaders’ Summit in Mexico City, where they discussed issues including economic cooperation, climate change and the movement of people and drugs across the southern U.S. border.

“We’re true partners, the three of us,” Biden said at a news conference after a roughly two-hour meeting at Mexico’s National Palace. “There can no longer be any question, none, in today’s interconnected world; we cannot wall ourselves off from shared problems.”

The agenda for the meeting was wide-ranging, but White House aides said that the broad challenge of how to secure the border was his top priority at the summit. A record-breaking flow of migrants throughout the region has strained both the U.S. and Mexico, and even before the meeting, administration officials said that the three leaders had agreed to continue working together toward “safe, orderly and humane migration” (The New York Times).

▪ Politico: Classified documents, Brazilian protests overshadow Mexico summit.

▪ The Wall Street Journal: Biden, López Obrador, Trudeau reach deals on chips, climate, immigration.

▪ Global News: Biden to visit Canada in March, White House says.

▪ The Washington Post: U.S. and Japan set to announce shake-up of Marine Corps units to deter China.

The Department of Education proposed regulations Tuesday that would reduce the monthly bills for certain federal student loan borrowers. Under the proposal, the Biden administration would overhaul one of the existing income-driven repayment plans, known as Revised Pay As You Earn or REPAYE, which caps borrowers’ bills at a percentage of their discretionary income.

“We cannot return to the same broken system we had before the pandemic, when a million borrowers defaulted on their loans a year and snowballing interest left millions owing more than they initially borrowed,” Secretary of Education Miguel Cardona said in a statement (CNBC).

The White House is attempting to use the Republicans’ references to cutting Social Security and Medicare as a political weapon, a strategy that builds off their messaging in the midterm elections,  report The Hill’s Alex Gangitano and Brett Samuels. “Saving Social Security” and protecting Medicare from GOP encroachment are popular refrains with voters across party lines. It’s political terrain Democrats know well over decades.

“They are going to try to cut Social Security and Medicare. It could not be clearer,” White House chief of staff Ron Klain tweeted Monday in response to a clip of Rep. Michael Waltz (R-Fla.) saying on Fox Business Network that major spending cuts would require changes to entitlement programs. Klain worked for former President Clinton during an earlier era of Democrats’ prominent confrontations with Republicans over Social Security.

IN FOCUS/SHARP TAKES

➤ INTERNATIONAL

The Pentagon is planning to bring Ukrainian troops into the United States for training on the Patriot missile defense system, U.S. officials said Tuesday, signaling the White House’s latest test of Russian President Vladimir Putin’s threshold for Western intervention in the conflict.

The training will occur at Fort Sill in Oklahoma, and could begin as soon as next week. The base is home to the U.S. military’s basic Patriot missile defense training program and another curriculum designed to teach American personnel field artillery maneuvers (The Washington Post).

Reuters: Russian force claims control of Soledar as east Ukraine battle heats up.

At least 17 people were killed in southern Peru on Monday amid ongoing protests over the ouster of the former president, an extraordinary bout of violence that led to criticism of excessive force by the military and the police. Monday’s fatalities bring the total death toll since the protests started in December to 47; following the country’s leftist president, Pedro Castillo’s, attempt to dissolve Congress and rule by decree (The New York Times).

▪ The Washington Post: Former Brazilian President Jair Bolsonaro’s new life as a Florida man: Fast-food runs and selfies.

▪ The New York Times: The Marcos-Duterte ticket won. Can this Philippine alliance last?

▪ The Norman Transcript and AP: South Korean President Yoon Suk Yeol, in an interview, cited discussions with the U.S. about joint planning potentially involving U.S. nuclear assets. ”I think it’s right for South Korea and the United States to cooperate because both of us are exposed to the North Korean nuclear threat,” Yoon said. 

OPINION

■ Biden’s classified-records headache is Garland’s special-counsel nightmare, byJonathan Turley,opinion contributor, The Hill. https://bit.ly/3X3p6PK 

■ Four questions soon to be answered in Georgia’s probe against Trump, by Jennifer Rubin, columnist, The Washington Post. https://wapo.st/3Zrcq73 

WHERE AND WHEN

👉 The Hill: Share a news query tied to an expert journalist’s insights: The Hill launched something new and (we hope) engaging via text with Editor-in-Chief Bob Cusack. Learn more and sign up HERE.

The House will meet at 10 a.m.

The Senate will convene Friday at 1:30 p.m.. for a pro forma session. 

The president will receive the President’s Daily Brief at 1 p.m. 

Vice President Harris at 3 p.m. will host climate and environmental leaders for a discussion. 

Secretary of State Antony Blinken co-hosts the U.S.-Japan Security Consultative Committee at 2 p.m. with Defense Secretary Lloyd Austin, Japanese Foreign Minister Yoshimasa Hayashi and Japanese Defense Minister Yasukazu Hamada at the State Department. Blinken holds a 5 p.m. press availability with Austin, Hayashi and Hamada before his meeting at 6 p.m. with Hayashi.

First lady Jill Biden will head to Walter Reed National Military Medical Center for Mohs outpatient surgery as a precaution to remove a skin lesion over her right eye.

The White House daily press briefing is scheduled at 2 p.m.

ELSEWHERE

➤ STATE WATCH

Baltimore’s water issues are symptoms of a growing national problem, and the federal government has “waited too long” to invest in water infrastructure, EPA chief Michael Regan told NBC News in an interview.

“No community should ever experience what Flint [Michigan] experienced,” he said. “No community should ever experience what Jackson, Mississippi, is experiencing right now. We do have to have a proactive strategy to prevent cities from getting to that point.”

Thousands of Californians fled their homes on Tuesday as severe weather continued to batter the state, leaving one dead, a child missing and massive swaths of power outages. Moderate to heavy rains were expected to continue to hammer much of the Golden State on Tuesday as a new low-pressure system barreled toward the coast as part of a “parade of cyclones” that prompted a string of rescues Monday.

As of Tuesday afternoon, more than 182,000 utility customers were without power across California, according to PowerOutage.us. At least 11,800 of those were in Sacramento County alone, according to the outage tracker (NBC News).

San Francisco Chronicle: California storm: death toll rises to 15; high winds and hail for Bay Area cities.

➤  HEALTH & PANDEMIC

💉 When the Biden administration renews the COVID-19 public health emergency this week for the 11th time, it may mark the last time since the coronavirus pandemic began that the government declares its presence a national crisis. Senior Biden officials are targeting an end to the emergency designation for COVID-19 as soon as the spring, Politico reports.

The decision, which has not yet been finalized amid more immediate efforts to manage a recent spike in COVID-19 cases, would trigger a complex restructuring of major elements of the federal response, and set the stage for the eventual shifting of greater responsibility for vaccines and treatments to the private market.

👴 It’s not just stress, underlying medical conditions and poor diet that contribute to hair loss. A group of Chinese scientists have found that men who drink cans of energy drinks, soda, sports drinks — and even sweetened tea and coffee — are at greater risk of suffering from hair loss. Experts from Tsinghua University in Beijing gathered 1,000 men who were required to consume between one and three liters (close to one and three quarts) of the drinks each week, and found those who consumed more than one sweetened drink each day were at a 42 percent greater risk of experiencing hair loss, in comparison to men who did not drink any (The Independent).

Doctors are renewing warnings and urging people to disclose marijuana use to their physicians before surgical procedures. Cannabis use, particularly when it’s regular and heavy, can leave patients in more pain than normal after surgery and getting high just before an operation can put a patient at risk for heart problems, even a heart attack, Samer Narouze, president of the American Society of Regional Anesthesia and Pain Medicine, told USA Today.

Information about COVID-19 vaccine and booster shot availability can be found at Vaccines.gov.

Total U.S. coronavirus deaths reported as of this morning, according to Johns Hopkins University (trackers all vary slightly): 1,097,660. Current U.S. COVID-19 deaths are 2,731 for the week, according to the Centers for Disease Control and Prevention. (The CDC shifted its tally of available data from daily to weekly, now reported on Fridays.)

THE CLOSER

And finally … 🔭 Astrophotographers are a competitive lot and there’s a photo contest just for them with a March 3 deadline. Judges are in search of “the most striking images of our cosmos.” 

Space has not been boring in the past year for those with telescopes and cameras. The Royal Observatory Greenwich’s 15th annual Photographer of the Year competition invites young shutter bugs as well as seasoned experts from around the world to submit up to 10 space-related images depicting the cosmos in various categories, such as comets, nebulas, skyscapes and “people and space,” to compete for cash prizes as well as the “wow” factor (Space.com). Submitted images must have been taken after Jan. 1, 2022.

Stay Engaged

We want to hear from you! Email: Alexis Simendinger and Kristina Karisch. Follow us on Twitter (@asimendinger and @kristinakarisch) and suggest this newsletter to friends!

Here are the K Street lobbyists closest to McCarthy

House Republican Leader Kevin McCarthy’s ascension to Speaker could be a boon for a small group of lobbyists within his inner circle.

McCarthy has relied on a small handful of lobbyists for advice and fundraising help. Now those allies are a hot commodity among corporate clients eager to make inroads with McCarthy, who is in lockstep with corporate America on economic policy but has chastised major companies for wading into social and political issues.

“He has an open door to businesses and industries which align with cutting regulations and costs for consumers and families,” said John Stipicevic, a lobbyist at the CGCN Group and former deputy chief of staff for floor and member services for McCarthy. 

It took four days and 15 votes for McCarthy to secure the Speakership, and former aides of the new Speaker who have moved to lobbying positions gave him credit for cutting a deal and offering a series of concessions to secure the votes of his opponents.

“It’s a testament to Kevin, and it’s a testament to his staff, that he was able to keep on talking and eventually land this plane,” said Ben Howard, a lobbyist at the Duberstein Group who served as McCarthy’s floor director. “That kind of perseverance is how he’s going to go into negotiations with the Senate and the White House.”

McCarthy’s K Street friends

McCarthy’s closest K Street allies include Stipicevic, Howard and Jeff Miller, McCarthy’s longtime friend and trusted adviser.

The GOP leader leans on Miller as his go-to source for big-money donations. Miller and CGCN Group lobbyists hosted a D.C. fundraiser for McCarthy last January that brought in $9.5 million, a stunning haul for a single night in the nation’s capital.

But allies say that McCarthy hasn’t relied on traditional K Street giants to help raise campaign cash. Most of his campaign money has come from wealthy individuals and small-dollar online donors.

“McCarthy is going across the country raising huge sums that really dwarf anything that anybody in D.C. can do. The fundraising game has changed considerably, and I think that’s reflected in the party’s emphasis,” said Will Dunham, McCarthy’s former deputy chief of staff for policy who joined lobbying powerhouse Brownstein Hyatt Farber Schreck in October. 

McCarthy’s office didn’t respond to a request for comment for this story.

In an effort to get closer to the newly elected speaker, K Street firms and corporations have rushed to scoop up top McCarthy aides, like Dunham. 

Nick Bouknight, former executive director of McCarthy’s political operation, joined lobbying giant Capitol Counsel in November. 

Intel Corp. hired former McCarthy policy director Steve Pinkos as a senior director in July, while Lyft added McCarthy aide Emma Rindels to its lobbying team in April. 

Former McCarthy chief of staff Tim Berry, who leads government affairs at JPMorgan Chase, was promoted as the bank’s chairman of the Mid-Atlantic region last month.

Stephen Ruppel, McCarthy’s political director for the 2022 election cycle, on Monday joined Miller’s firm, Miller Strategies, which represents deep-pocketed clients such as Apple and the pharmaceutical industry’s leading trade group. 

It’s common for congressional staffers to head downtown for the opportunity to multiply their salary after their boss gets a promotion. Several former top aides to Speaker Nancy Pelosi (D-Calif.) were among the most sought-after lobbyists in D.C. for more than a decade.

Thousands of lobbyists flooded congressional offices after the Capitol campus reopened for the first time in years last week. McCarthy pushed Capitol officials to end COVID-19 rules that restricted lobbyists’ access to lawmakers.

“Whether you’re a constituent, a consultant, company, or trade association, this is a really good time to go in and talk to members again, on both sides of the aisle,” said Tim Pataki, a lobbyist at the CGCN Group and former leadership aide to McCarthy during his time as House Majority Whip.

Corporate America eyes lobbying wins 

The Speaker’s message to corporate America, according to his allies on K Street, is simple: find ways to fit into McCarthy’s agenda or stay out of the way. 

They said that corporate clients will find success lobbying House Republicans over common goals, such as reducing taxes, expanding oil and gas production and fighting Biden regulations aimed at curbing emissions or empowering worker unions. 

But they caution corporations against trying to fend off investigations into Big Tech over allegations of anti-conservative censorship or probes of hedge funds involved in environmental, social and governance investing, among other initiatives targeting businesses.

McCarthy-linked lobbyists expect legislation to slow down under divided control of Congress — which typically leads to lower lobbying spending — and a razor-thin GOP majority that will likely struggle to reach consensus on key bills. 

They pointed to efforts to boost workforce development or counter China’s economic dominance as potential bipartisan measures that would interest corporate America and could make it to Biden’s desk.  

For some corporate clients, the top priority is boosting their relationship with the new Speaker, particularly if Republicans look like they’ll make gains in 2024. 

Major corporations and trade associations are on thin ice with Republicans over their public comments on political issues — McCarthy allies point to the wave of companies that criticized Georgia Republicans’ 2021 voting law as being discriminatory toward voters of color.

GOP leaders were also enraged when dozens of major corporations pledged to cut off PAC contributions to lawmakers who objected to the 2020 election results following the Jan. 6, 2021, Capitol riot, including McCarthy.

Most companies reversed course last year when it became clear that Republicans were favored to retake the House. McCarthy’s allies on K Street urged executives to resume donations to help restore relations with House GOP leaders. 

PACs affiliated with corporations and their trade groups ultimately funneled $66 million to election objectors, according to an analysis from nonpartisan research group OpenSecrets. McCarthy was the top recipient of that group, bringing in nearly $2.2 million to his campaign and leadership PAC.

“The thing that probably rankled congressional Republicans the most was companies very opportunistically making sanctimonious statements about Republicans and publicly trashing them or publicly distancing themselves from them,” Dunham said. “I think that’s actually what rankled them as much or more than the actual dollars.” 

McCarthy has directed much of his ire at the U.S. Chamber of Commerce, the nation’s largest corporate lobbying group. He lashed out at the chamber over its decision to endorse a slate of vulnerable House Democrats ahead of the 2020 election, saying the group had “sold out.” 

In November, McCarthy privately urged the Chamber to replace its leadership, warning that he wouldn’t work with the group if it didn’t make changes. The Chamber rejected his demand. 

“Speaker McCarthy and the Republican House majority are an important check and balance on the excesses and overregulation from the current administration,” a Chamber spokesperson said. “We look forward to working with leadership and all members of Congress on pro-growth policies that will move the American economy forward.”

Source: TEST FEED1